Aston Martin to raise £653mn as Saudi Arabia becomes major shareholder

Aston Martin to raise £653mn as Saudi Arabia becomes major shareholder

Aston Martin will raise £653mn in fresh investment by bringing in Saudi Arabia as a major shareholder and launching a rights issue, after turning down an investment offer that would have handed control of the luxury carmaker to China’s Geely and former Aston owner Investindustrial.

Saudi Arabia’s Public Investment Fund will take a 16.7 per cent shareholding via a £78mn equity placing, giving it two board seats.

Aston will also launch a £575mn rights issue, with PIF, major shareholder Mercedes-Benz, and owner Lawrence Stroll’s Yew Tree consortium all agreeing to take up their rights.

In total, Yew Tree, Mercedes and PIF will invest £335mn through the rights issue or the fresh shares, Aston said. This leaves other investors to pay up to £318mn through the rights issue, which has been fully underwritten.

Around half of the money will be used to pay down debt, which stood at £957mn at the end of March.

The company also rejected a rival £1.3bn investment proposal from China’s Geely and Aston’s former owner, the Italian investment group Investindustrial, it said on Friday. Aston said the proposal was “an attempt by the Atlas Consortium to acquire a controlling and prospectively majority ownership position without any premium paid to existing shareholders”.

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